How live shopping can [.blue]unlock a new revenue stream[.blue] for eCommerce brands

February 2, 2023

min read

Many brands today face the dilemma of having eCommerce sites with high online traffic but low conversion rates. In contrast, brick-and-mortar stores experience low footfall but high conversions.

There are unique advantages to shopping online and in-store. On one hand, eCommerce platforms enable brands to reach a much wider audience without any geographical limitations or constraints on how many customers they can serve at once. On the other hand, physical retail is far more interactive – store associates are better able to build a rapport with customers, who reap the benefits of a more personalised, immersive, and sensory experience that encourages them to buy. 

Now, what if brands could combine digital and physical retail to create the ultimate selling experience? Livestream shopping does just that and has seen a dramatic boom in the last few years, with usage increasing by a worldwide average of 76% from pre-pandemic times to 2021.

What is livestream shopping?

Otherwise known as live shopping or live commerce, livestream shopping involves live broadcasting video footage online, giving brands another way to promote and sell their products in real-time. In turn, consumers can interact with the video host and each other, and purchase products directly from the livestream, which can take place on eCommerce sites or social media channels like Facebook, Instagram and TikTok

Livestreaming itself is far from a novel concept – the gamer-specific platform, Twitch, was arguably the first major proponent of livestreaming, converting it from a niche activity to a mainstream one in the early 2010s. However, livestreaming as a means of shopping only truly began to take off in 2016, when the Chinese eCommerce giant, Alibaba, launched its livestream shopping platform, Taobao Live. 

The ability to watch and shop simultaneously on Taobao Live skyrocketed sales, positioning livestream shopping as one of the most anticipated fixtures of the Chinese retail calendar. During the first 30 minutes of 2020 Singles’ Day – a major shopping event in China – the presales campaign on Taobao Live generated around £6.1 billion in sales for Alibaba. Unsurprisingly, the huge success of live commerce in the East has spurred platforms and brands in the West to try and take a slice of the livestream pie.

Livestream shopping from East to West

TikTok, Instagram, YouTube, Pinterest, and Amazon have all launched livestream shopping features on their platforms, the results of which have been mixed thus far. For instance, although TikTok Shop has proved popular in Asia, uptake for it has been slow further west, with TikTok suspending the expansion of this feature in Europe and the US due to low consumer awareness and adoption, as reported by the Financial Times. All that said, eCommerce shakers and movers remain excited about the possibilities of livestream shopping and research appears to support the hype. 

Nearly a third of global consumers think additional livestream shopping opportunities would encourage them to buy through their social channels. In other words, if the option was more prevalent, they would likely partake. It seems that for live shopping to become a success in the West, eCommerce brands and social media platforms will need to convince consumers that purchasing products on TikTok, Instagram or Facebook is as easy and secure as doing so on Amazon. With live-commerce-initiated sales predicted to account for 10-20% of all eCommerce by 2026, it’s clear that this rapidly growing channel provides several opportunities to drive value. 

Why should eCommerce brands offer livestream shopping?

Blending entertainment with instant purchasing and, thus, instant gratification, the appeal of livestream shopping to consumers is evident but what are the benefits to eCommerce brands?

Differentiates your brand, enhances appeal & heightens awareness. We already know live commerce has seen huge success in Asia, yet many brands in the UK, US and Europe are only just beginning to embrace live commerce as part of their eCommerce strategy. Early adopters of this relatively new trend are more likely to stand out from competitors and appeal to consumers, who often favour brands that offer more flexible ways of shopping.

Improves & accelerates conversions. Entertaining, interactive, and immersive, live commerce telescopes customer decision journeys from awareness to purchase, making it perfectly suited for impulse buying. The sense of scarcity and purchase urgency is emphasised by gamified video content that includes exclusive discounts, limited-time promotions, and giveaways. Livestream shopping also leverages FOMO – also known as “fear of missing out” – to encourage consumers to buy. Influencer and celebrity hosts can prove particularly effective in driving conversions due to the high trust and loyalty of the fanbase that they bring to a livestream. Brands that have adopted live commerce report conversion rates of up to 30%, which is almost 10 times higher than in conventional eCommerce.

Expands your audience reach. The nature of livestreams means you can reach an unlimited number of potential customers from anywhere in the world and, therefore, increase your chances of generating more sales than you ever could through a physical store. Fashion brand, Tommy Hilfiger, extended its livestream programme to Europe and the US following successes in China, where one livestream event reportedly attracted 14 million viewers and sold out of 1,300 hoodies in two minutes.

Increases engagement & brand loyalty. There’s something incredibly powerful behind wandering into your favourite store, having interesting conversations with other shoppers, learning about the products on offer, and getting inspired. Livestream shopping brings this personalised, in-store experience to the online world, where eCommerce brands can capitalise on the social aspect of shopping to build a loyal community around their products – a community that is emotionally invested to buy. Canadian retailer, Aldo, experienced an impressive 308% increase in engagement and generated 17,000 page views on its website in the five days after a successful livestream event in 2021. 

7 steps to getting started with live commerce

Although livestreaming is still an emerging eCommerce channel with many unknowns, the lessons learned thus far are being put into practice to achieve maximum ROI from each live shopping event. Brands need only ensure they consider and adapt their approach based on what works for their unique business and audience.

1. Determine which product(s) you wish to feature in your livestream. 

Are you seeking to sell-out a new product, clear a slow-moving item, or give your bestseller an extra sales boost? The type of product you promote on your livestream will help you decide on the best way to showcase that product through your live video content. If you’re looking to sell a new line of eyeshadows, for example, you could work with a beauty & cosmetics influencer to host a livestream demonstrating how customers can create unique make-up looks using your new products.

2. Identify who your livestream host will be. 

When 84% of shoppers have made a purchase based on an influencer’s recommendation, who you have to host your livestream matters. Influencer marketing holds a great deal of power, but you don’t have to invest in a mega influencer to achieve the traction you want. Not only do micro influencers drive more conversions but with their highly targeted audience, they can produce a 20% higher conversion rate than bigger influencers at a significantly lower price, thus leading to a better ROI overall.

3. Prepare your back-end systems. 

Make sure your online product catalogue is up-to-date and that your eCommerce site is prepared to receive orders, particularly if you’re anticipating a high volume of traffic from the livestream. It’s vital to have a reliable fulfilment operation in place to ensure orders are picked, packed, and shipped for the best customer experience. Working with a 3PL fulfilment provider like Zendbox that specialises in eCommerce will ensure your customers receive their order on time and in perfect condition for a 5-star fulfilment experience

4. Assemble your livestream team. 

It’s prudent to have technical support on hand to ensure your livestream is set-up as desired and to troubleshoot any issues that might arise during the event such as video lag or poor sound. You’ll also need an in-house moderator to handle any comments and questions from viewers and – if needed – provide direction to your host once you go live. Taking these steps is important for a smooth and successful livestream.  

5. Market, market, market. 

It goes without saying that if you don’t do any marketing, nobody will know about your livestream and, therefore, will not attend! Promote your livestream on both your online and offline channels, paying close attention to those that your target audience most frequent. Make sure your advertising material specifies exactly what viewers can look forward to and don’t be afraid to get creative with your copy to trigger the FOMO feeling that encourages 60% of shoppers to buy.

6. Relax and enjoy. 

Now that you’re prepared and ready to go, give your audience a few minutes to join the livestream. This is a great opportunity for your host to start building a good rapport with viewers and get them excited about what’s to come. Remember, the heart of livestream shopping is the community that typically comes together around the event so relax, have fun, and keep it simple. This is more likely to result in authentic interactions that generate sales and foster customer loyalty. 

7. Don’t forget to save your livestream. 

Although 23% of global viewing time is spent watching live video content, the other 77% goes towards on-demand content. As such, record your livestream if you can and ensure the recording is available to view from your website and/or social media channels after the livestream has ended. This on-demand content could make a significant difference in converting a customer to your brand and products. On average, 75-85% of sales and views happen post-live in the few weeks following a livestream event.

See now, want now, buy now

The see-now-want-now-buy-now mentality of today’s consumers is ultimately driving the trend of livestream shopping, the global market for which is predicted to be valued at £431 billion by 2030. Although the West is still a long way from replicating China’s success in the sector, it’s clear that livestream shopping enables brands to strengthen customer relationships, increase engagement, and break down the buyer-seller barriers that plague conventional eCommerce. Embracing this emerging trend now may be the differentiator and competitive advantage that wins your business more sales and loyal customers. 

Book a demo to find out how Zendbox can help you streamline your eCommerce fulfilment operations and support your live commerce strategy.

Gilson Pereira
Head of Customer Experience at Zendbox

Resilient and forward-thinking, Gilson is responsible for leading the strategy, planning and execution of our customer experience (CX) goals, liaising with department heads to ensure every team at Zendbox works cohesively to provide our clients a positive and seamless experience across all touchpoints.

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